The group is understood to have told 11 of its 25 London-based dealers late
last week that their job is at risk

Charles Stanley, the 222-year-old wealth manager and stockbroking firm, is preparing to axe a fifth of its equity dealers.

The group is understood to have told 11 of its 25 London-based dealers late last week that their job is at risk, and that five of them will be cut.

It is thought that voluntary redundancy may be considered and that the process will take about three weeks.

The losses will be from Charles Stanley’s dealing room, used by investment managers to execute stock market trades. Dealers take stock orders by telephone and go into the market to find the best price for the managers.

The cull comes after a difficult period for the broker; in April it warned that annual profit before tax would miss market expectations by more than 10pc.

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In the event, the full-year numbers, posted in June, showed that pre-tax profits for the 12 months ending March slumped £6.1m to £9.1m, a 33pc drop. The fall came despite a 17pc rise in revenues to £149m.

Sir David Howard, the brokerage’s chairman, said that earnings had been hurt by “significant cost and investment in our future”.

During the year, the group had bought a number of investment management teams and had also invested in the roll-out of its web-based Charles Stanley Direct service.

The firm is a well-known name in the City and traces its roots back to 1792 and the founding of the Walkers, Eyre and Stanley Bank in Sheffield. The group has 33 offices around the UK and some £20bn of funds under management.